If you have ever had a close loved one pass away leaving you an inheritance, you have likely had to go through the probate process. Probate is the term used for how the courts determine what is going to happen to the assets of someone who has died. The goal of the probate court is to determine what the deceased wanted to happen with their assets, and distribute them accordingly to the extent possible. Unfortunately, the probate process can be quite long and complicated, easily taking six months to a year to complete.
With a little bit of planning ahead of time, however, it is possible for someone to keep their estate out of probate when they pass away. This will allow their loved ones to get their inheritance much more quickly and without having to spend a significant amount of money on an attorney to help them through probate. The most common way to avoid probate is through the use of legal trusts, since they do not need to pass through the probate courts. Learning why legal trusts do not go through probate will help you to see their many benefits for you and your loved ones.
You Do Not Own Assets in a Trust
When you create a legal trust, you will put certain assets into it. This could include stocks, real estate, cash, and much more. Once the trust is in place, you will legally no longer be the owner of those assets. Instead, they are owned by the trust. You will simply be named as the owner of the trust, giving you control over all of the assets that you placed within it.
This may sound like an odd loophole at first, but this type of thing occurs in many other situations in life. If, for example, you owned a business, you may buy a computer for use by the business. Just like with a trust, you would not personally own that computer, but you would still have control over it.
Part of the legal trust is identifying who the beneficiary is upon your death. Since this will all be set up and signed as a legal document, there will be no need for it to pass through probate. The beneficiaries simply become the owner of the trust upon verification if your death, which usually happens very quickly.
Details Worked Out Ahead of Time
One of the things that makes the probate so complicated is that the courts have to identify all the assets the deceased owned, all the debts that existed, and many other things. This can be a time-consuming process. With a legal trust, however, you will have already identified all of these things and had them addressed during the creation of the trust. This helps to eliminate any confusion or delays that could otherwise occur.
Get Your Legal Trust Started Today
Setting up a legal trust is one of the smartest things you can do to protect your estate and help maximize the benefits that you leave to your loved ones. There are many different types of legal trusts that you can use depending on what types of assets you have, and what you want to do with them. If you have questions about a legal trust or anything to do with estate planning, please contact us to schedule a consultation. We can go over your situation with you and help to determine the best path forward.